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The Limited Liability Partnerships Act was passed in 2000, paving the way for the first tax transparent vehicle in the United Kingdom with limited liability where all members participate in its business. In mixing the principal advantages of a partnership and a corporation, the LLP has become the vehicle of choice for many hedge fund managers, private equity GPs and other financial services firms. In addition, new businesses spinning off from existing businesses and startups are frequently choosing to structure themselves as LLPs.

Drawing on the firm’s recent experience, Simon Firth (Partner, London) re-examined the salient features of the LLP, discussed the key issues in a members' agreement, and considered topical issues affecting the structure and operation of the LLP.